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With the 4th of July approaching, it's always a good time to get a bit of perspective and take a look at what may happen in the second half of the year. As with predictions they generally tend to never come true, but here are 3 market predictions for the 2nd half of the year.

1- Crude oil will trade down under $100/barrel. As global growth continues to slow, especially in overheated emerging markets, some of the the speculative froth will leave the market and the price will start heading down to a point more in line with fundamentals.

2- The US Dollar will rally against the Euro, and reach a level of 1.42 by the end of December, down from the 1.58 current levels. With European growth expected to potentially contract by more than 1% in the coming quarters, and the US staying out of recession, the market will re-focus on growth differentials in the for-ex markets, providing some much needed strength for the greenback.

As if pouring salt on a wound, Moody's came out today and cut the rating of luxury home builder Toll Brothers (NYSE: TOL) to junk status. Their rating was cut to Ba1 from Baa3.

As reported in a Bloomberg report, Moody's said: " While the company is one of the only remaining home builders that is currently generating earnings before impairment charges, Moody's does not expect this to continue, as falling prices and lower absorption rates continue to impact margins."

Toll Brothers CEO Robert Toll has recently told the market that he thinks that real estate is still in a downward spiral. It seems that Moody's agrees. While this all maybe true, for long term investors, shares in Toll Brothers are certainly intriguing under $19. Long term, contrarian inclined investors may want to do a bit of research as the shares maybe approaching levels that are hard to refuse.

Aaron Katsman is the lead Portfolio Manager and Managing Director of America Israel Investment Associates, LLC. and Senior Editor of IsraelNewsletter.com. DISCLOSURE: Writer's fund has no position in any stock mentioned, as of 7/3/08.

In an attempt to curb all the 'hot money' flowing into China, the Chinese government will start checking exporter's foreign exchange settlements. Government control of the exchange rate has what has created this problem in the first place. The way to curb this problem is for the Chinese to freely float their currency and let it appreciate to the level that the market thinks it should be trading it.

The government is desperate to cool the flow of money coming into to China as it's trying to fight surging inflation. According to an article in Bloomberg: " China's foreign exchange reserves, the world's largest, surged 40 percent to a record $1.68 trillion in March from a year earlier, according to the latest official data. The excess cash flooding the financial system may stoke 12-year-high inflation in the fastest-growing major economy."

Most analysts are of the opinion that these checks are impractical and won't solve the problem. How many people will the government have to hire to wade through all these transactions? On the other hand maybe this is how China will solve the problem that they will have after the Olympics finish, and the government works projects come to an end. They can hire all of the unemployed and have them check all the transactions.

The real solution: Float the Yuan.

Aaron Katsman is the lead Portfolio Manager and Managing Director of America Israel Investment Associates, LLC. and Senior Editor of IsraelNewsletter.com. DISCLOSURE: Writer's fund has no position in any stock mentioned, as of 7/3/08.

With a slowing economy and corporate layoffs being announced daily, look for online education companies to benefit. Many unemployed are and will be looking for a profession, and many employed people are always looking to make career changes. Online education companies are therefore enjoying higher enrollment rates.

Shares in Apollo Group (NASDAQ: APOL) are surging over 20% on a strong earnings report.

According to the AP: " Total degree enrollment rose 11 percent during the quarter to 345,300 students, versus a year ago. Apollo has boosted student retention with expanded academic programs, improved courses and other services." The company even managed to raise tuition by 4-10% depending on the program.

Pretty good business climate if you can both raise prices and increase enrollment. With a continuing weak economy, look for shares in online education to potentially be an interesting trade in a struggling economy.

Aaron Katsman is the lead Portfolio Manager and Managing Director of America Israel Investment Associates, LLC. and Senior Editor of IsraelNewsletter.com. DISCLOSURE: Writer's fund has no position in any stock mentioned, as of 7/2/08.

It's no secret that Talk Radio host extraordinaire Rush Limbaugh has revolutionized the alternative media. With his new contract, it appears that Rush is once again on the cutting edge of societal evolution, and has once again laid down the gauntlet that he is light years ahead of his competition. What's so amazing is that in an era when traditional media is having all kinds of problems, whether it's declining newspaper sales, or declining ratings for the nightly news, the man who sits behind the golden EIB microphone is forging ahead as if nothing is happening.

According to a press release, Limbaugh has signed a long-term contract extension:

Advertiser and affiliate demand is at an all-time high for Mr. Limbaugh. President of Premiere Radio Networks Charlie Rahilly stated, "The Rush Limbaugh Show enjoys an unprecedented platform of radio affiliates. Plus, advertisers harness the intensity of listener engagement -- no one's 'word of mouth' about a product or service delivers more impact than Mr. Limbaugh does. The Premiere team is proud to partner with Mr. Limbaugh deep into the next decade."

Those pundits who think guru investor Warren Buffett's time has come and his magic faded away are bolstered by a Bloomberg report that says shares in Berkshire Hathaway (NYSE: BRK.A) slumped some 19% since mid-December. Buffett has been hurt by large investments in both insurance and banks, industries that have suffered tremendously.

Lest you think this short-term lack of performance has swayed investors into looking elsewhere to park their money, many investors are looking at the fall in Berkshire stock as a buying opportunity.

According to Bloomberg, Frank Betz, a partner at Warren, New Jersey-based Carret Zane Capital Management said he'd "put a new client in Berkshire right now. [...] It's probably the highest-quality collection of individual companies that's ever been assembled. Long slides are not in the Berkshire Hathaway lexicon."

With the stock market drop, many contrarian investors think that stocks have hit bottom and are very cheap. Buffett, who is sitting on such a large cash position, may be able to take large stakes in solidly profitable yet beaten up companies.

If he decides to put his cash to work, he has the ability to get deals that happen only once or twice in a lifetime. He may end up providing returns that make his previous track record look just average. For the Buffett investors, the best may is yet come.

Aaron Katsman is the lead Portfolio Manager and Managing Director of America Israel Investment Associates, LLC. and Senior Editor of IsraelNewsletter.com. DISCLOSURE: Writer's fund has no position in any stock mentioned, as of 7/1/08.

You think that only U.S. citizens have been hit hard by a lousy real estate market? New data released by the Nationwide Building Society in the UK, points to similar housing problems for our friends across the pond.

According to a report on Bloomberg: "Real-estate stocks had their worst performance in more than 20 years in the second quarter and Bank of England Governor Mervyn King predicts 'extremely weak activity' in the housing market. Mortgage approvals fell to the lowest in at least nine years in May and consumer confidence dropped to the lowest level in 18 years last month, reports showed yesterday."

While many predict that the US housing market will only start recovering in another year or two, I think that in the UK, you can double that amount of time. During the bull housing run, prices in the UK just skyrocketed, and what goes up tends to come back down. Also, it's important to keep in mind that the US has already been in the midst of the slump for a few years already and we are much closer to the end of this negative cycle than many international housing markets, as they just recently entered the downturn.

Investors thinking of buying beaten up UK housing real estate, should be very careful, as it's possible that there could be further price drops.

Aaron Katsman is the lead Portfolio Manager and Managing Director of America Israel Investment Associates, LLC. and Senior Editor of IsraelNewsletter.com. DISCLOSURE: Writer's fund has no position in any stock mentioned, as of 7/1/08.

Yahoo's (NASDAQ: YHOO) embattled management and board have one month left to prove to shareholders that they made the right call in rejecting Microsoft's (NASDAQ:MSFT) bid. With shares trading at about $20, they are going to have to do some fancy footwork to show why rejecting a $31to $33 per share offer was actually good for shareholders.

Yahoo is trying to convince investors that a proposed 'search' deal with Google (NASDAQ:GOOG) will provide the growth needed to restore Yahoo to previous glory. According to an AP report: " By relying on Google's superior technology to show some of the ads alongside its search results, Yahoo believes it can increase its annual revenue by about $800 million and generate another $250 million to $450 million in annual cash flow."

Keep in mind that since the Microsoft deal fell apart, Yahoo has lost more than $16 billion in market cap. It is going to have to generate a lot more in revenues to show that they made the right choice.

My other problem is that I have many friends who over the last week have told me they can't access their Yahoo mail or open up their saved stock portfolio's on Yahoo Finance. I, personally, have been locked out for two days.

It was about 9 years ago that then-Federal Reserve chairman Alan Greenspan warned investors of "irrational exuberance." Then at issue was the run up of hi-tech stocks. The question is if we are experiencing a similar "irrational exuberance" with regard to the surge in crude oil prices.

I know the arguments that there is too much demand for the available supply, that oil is a finite resource and the world is running out of crude, and that very few new sources of crude have come online in decades. My question is, didn't the market know this 6 months ago? All of the sudden oil traders woke up one morning and realized that we had all these problems?

What I don't understand is that you can't have it both ways. You can't claim that the world has entered a sustained slow growth era, and yet continue to claim that strong demand is what is causing the surging price. If we do still see very strong demand than maybe the global economy isn't as bad as most think.

I am no technical analyst, but the way crude has been trading sure has the makings of a bubble ready to pop. It's one thing to slowly and steadily increase in price, like we have seen for the last 5-6 years. It's quite another to see it move straight up in a vertical line, like we have seen of late.

Investors beware. This sure seems like another example of "irrational exuberance."

Aaron Katsman is the lead Portfolio Manager and Managing Director of America Israel Investment Associates, LLC. and Senior Editor of IsraelNewsletter.com. DISCLOSURE: Writer's fund has no position in any stock mentioned, as of 6/29/08.

Baudouin Prot , CEO of one of Europe's largest and best run banks, BNP Paribas (OTC:BNPQY), said that he believes that the worst of the subprime mess is behind us. What makes this statement important is that BNP is one of the few major banks not to take a serious hit from subprime. The bank estimates that their exposure to subprime is minimal this year and was only about 200 million Euro in '07.

In a Marketwatch report, Prot says: "There are no doubts the crisis isn't over. However, the worst should be over and I believe that in the second semester the crisis may normalize."

While I am skeptical of any bank CEO telling me that the worst is behind us, as they certainly have their own agenda of keeping their stock prices up, when the CEO of a bank that has had little exposure to the crisis tells me that he thinks the tide is turning, I would listen. After all he has an interest in watching some of his competitors fall further, as he could then swoop in and buy on the cheap. The fact that he isn't talking down the industry means that he truly thinks that we are beginning to see the light at the end of the tunnel.

No one seems ready to call a bottom in the financial sector, but with this report, investors may want to start researching the financials that are in the best shape, as we may potentially be near a bottom.

Aaron Katsman is the lead Portfolio Manager and Managing Director of America Israel Investment Associates, LLC. and Senior Editor of IsraelNewsletter.com. DISCLOSURE: Writer's fund has no position in any stock mentioned, as of 6/29/08.

The news couldn't get much worse. Commodity prices keep soaring, consumer confidence is in the gutter, inflation has reared its ugly head, the US dollar loses value by the day and each day we read of more company layoffs. With all this seemingly endless stream of negativity the question is if now is the time to start buying stocks?

There is an old investing adage that says that you should invest when there is "blood in the streets." There is no doubt that it takes some serious courage to buy stocks at this point, but if you are a long term investor, you have to think that the tide will turn at some point in the not too distant future. I know many of you will say that we haven't even gotten close to hearing the worst of the news. That we are in store for consumer bankruptcies, and maybe a large bank or two to fail. My point is that the market is already pricing that in. Or at least most of that has been priced in. Even stocks like Google Inc. (NASDAQ: GOOG) have fallen to levels that they could be considered value stocks as opposed to growth stories. Stocks just seem cheap.

No one can predict if the market will drop another 15% from our current levels. What is indisputable is that the market is selling at a large discount to where we were eight months ago. While some of the sell-off is justified, keep in mind that the market generally overshoots both when it rises and when it falls.Then it finds a middle ground.

With all of today's bad news, maybe it's time to back up the truck and start buying stocks.

Aaron Katsman is the lead Portfolio Manager and Managing Director of America Israel Investment Associates, LLC. and Senior Editor of IsraelNewsletter.com. DISCLOSURE: Writer's fund has no position in any stock mentioned, as of 6/29/08.

While Asian stock markets like Vietnam were the darlings of investors during 2006-07, market action and economic fundamentals may be a precursor to another Asian financial crisis like we had 11 years ago. The Vietnam market has lost more than 55% during '08, and with surging inflation, the currency is showing cracks of weakness as well.

May's inflation rate surged by 25.2%. Reading a recent Reuters report, one gets the feeling that there is a big problem on the horizon: "All readings from the economy are not healthy," a Vietnamese dealer with a foreign bank said. "The economy is not performing as well as expected by investors so they are pulling out and this trend is not short-term because we see nobody arriving. It is now an approach to a crisis."

Vietnam's dong is trading a multi-month lows, and more importantly the offshore forwards market has priced in a 30% depreciation in the currency. Countries including the Philippines, China, India, Thailand and even Hong Kong are all experiencing rapid inflation with no end in sight. This sounds all eerily familiar to what happened 11 years ago.

Investors should pay close attention to what's happening in South East Asia, as it could potentially have unpleasant ramifications for the rest of the globe.

Aaron Katsman is the lead Portfolio Manager and Managing Director of America Israel Investment Associates, LLC. and Senior Editor of IsraelNewsletter.com. DISCLOSURE: Writer's fund has no position in any other mentioned, as of 6/3/08.

News that FedEx (NYSE: FDX) is taking a huge charge of $891 million to drop the name Kinko's marks both the end of an era, as well as a huge waste of money that will impact shareholders.

According to the story in MarketWatch: "The company called it a "strategic decision" to strike Kinko's from the retail chain's name, and the charge is broken down into a $515 million charge for the use of the trade name, $367 million in goodwill and $9 million in other expenses."

A $515 million charge for use of the trade name? You've got to be kidding. The new name is going to be FedEx Office. That's pretty catchy, huh? I am going to run over there right now to make a photocopy, because it is such great branding. Not.

The company says that Kinko's was primarily a photocopying and faxing service while FedEx office is an entire back-office for small and mid-sized businesses. Unfortunately, with the halting of new store openings and layoffs, it appears that small and mid-sized businesses don't need to outsource their whole back-office to FedEx.

Bye bye Kinko's, it was fun while it lasted.

Aaron Katsman is the lead Portfolio Manager and Managing Director of America Israel Investment Associates, LLC. and Senior Editor of IsraelNewsletter.com. DISCLOSURE: Writer's fund has has no position in any stock mentioned, as of 6/3/08

Shares in H.J. Heinz Company (NYSE: HNZ) are trading at a 52 week-high, on the heels of a better than expected earnings report. The AP reported that: "In the quarter, Heinz earned $194.1 million, or 61 cents per share, compared with $181 million, or 55 cents, a year earlier. Sales rose by 11 percent to $2.69 billion, driven by strong sales in Heinz's top 15 brands. Prices rose 4.5 percent while sales volume went up by 1.2 percent."

The company also raised its dividend by 9%. What's interesting about the report is that we are finally seeing food producers be able to pass on some of their costs to consumers. This obviously will spell continued inflation pressures going forward, but for the food producer it provides some welcome relief. With the soaring costs of food materials, the ones making all the money are those that are producing the materials. Those that take the materials and add value to them are getting crushed. Until now they have had to eat much of the increase in production costs, thus adversely impacting their bottom lines. The fact that Heinz is trading at a 52 week high is a testament to solid management.

This group has the potential to move higher. If we were to get a drop in food material prices -- nothing goes up forever -- stocks like Heinz conceptually could benefit.

For long term investors looking for a contrarian play, you may want to take a look at the food group.

Aaron Katsman is the lead Portfolio Manager and Managing Director of America Israel Investment Associates, LLC. and Senior Editor of IsraelNewsletter.com. DISCLOSURE: Writer's fund has no position in any stock mentioned, as of 5/29/08.

With the U.S. congress trying to please all constituencies in this election year, especially those who took subprime mortgages and can't afford the monthly payments, where is congressional help for military families to save their homes from foreclosure?

A disturbing article on Bloomberg states, "In the midst of the worst surge in mortgage defaults in seven decades, foreclosures in U.S. towns where soldiers live are increasing at a pace almost four times the national average, according to data compiled by research firm RealtyTrac Inc. in Irvine, California."

With the stress of potential foreclosure on their minds, don't you think that this may impact their ability to fight in Iraq?

The article continues, "The Servicemembers' Civil Relief Act protects soldiers and sailors from losing homes for nonpayment of mortgages only while on active duty and for 90 days after they return home."

Ninety days?